Human embryonic stem cells (hESCs) can be directed to multiple cell lineages including the neural lineage. They thus offer a unique model to reveal molecular interactions underlying early neural specification that occurs in an experimentally inaccessible early human embryo. In our previous R01 project, we discovered, unexpectedly, that the transcription factor Pax6 is expressed uniformly and specifically in early or primitive neuroepithelial (NE) cells that are differentiated from hESCs. This is reminiscent of that of Sox1, the earliest and definitive NE transcription factor in vertebrate animals. We now show that forced expression of Pax6 results in neuroepithelial differentiation in human but not mouse ESCs whereas inhibition of Pax6 expression suppresses neuroepithelial differentiation from human but not mouse ESCs. We therefore hypothesize that Pax6 acts as a key mediator of the NE fate of hESCs and that control of human NE specification may be achieved through regulation of Pax6 expression. We will build hESC lines that conditionally express Pax6 or Sox1 and inhibit Pax6 or Sox1 expression via RNA interference (RNAi). Differentiation of these transgenic hESCs to NE using our defined system will address whether Pax6 is necessary and/or sufficient for NE specification from hESCs. This will reveal a novel role of the conserved protein Pax6 in human NE specification. We will then identify extracellular factors that regulate NE specification and determine if these factors do so by directly regulating Pax6 expression using chromatin immunoprecipitation and DNA binding assays. This will directly link extracellular factors to neuroectoderm transcription factors for the first time. Finally, we will assess whether NE specification from hESCs, especially the maintenance of the primitive state of NE and hence the plasticity to be re-patterned may be controlled by regulating Pax6 expression using our transgenic Pax6 hESC lines. If so, we will uncover a way to maintain somatic (neural) stem cells. Together, information gained from this proposal will provide us with a means of controlling the fate choice of human stem cells. It will also be instrumental to expanding the repair potential of the stem cells that are present in our brain.